The Accelerated Cost Recovery System (ACRS) is a depreciation method introduced by the Economic Recovery Tax Act of 1981 that allows taxpayers to recover the cost of an asset over a specified life that is shorter than the actual useful life of the asset, thereby reducing taxable income in the earlier years of an asset's life.
Capital assets are forms of property with a relatively long life, often used in trade or business, that receive specific tax treatments when sold, resulting in either capital gain or capital loss.
Machines or major tools necessary to complete a given task. Equipment must be capitalized and written off over the appropriate depreciable life.
Fixed assets are long-term assets used in the operations of a business, such as land, buildings, machinery, and equipment. These assets are essential for production and business operations and are classified in various ways on the balance sheet.
A leveraged lease is a lease agreement that involves a third-party lender in addition to the lessor and lessee. This structure is commonly used in financing large capital assets.
Long-Term Capital Gain (Loss) refers to the profit or loss earned from the sale of securities or capital assets held for more than 12 months. This gain or loss has special tax implications for individual and corporate taxpayers.
Ordinary income property refers to property whose sale at fair market value on the date of the contribution would have resulted in ordinary income or in short-term capital gain. It includes inventory, works of art or manuscripts created by the donor, and capital assets held one year or less.
A group of living animals or other livestock kept for their products, such as milk or wool, or for their young. It can be treated as a capital asset.
For tax purposes, a short-term capital gain (loss) is the profit (loss) realized from the sale of securities or other capital assets not held long enough to qualify for a long-term capital gain (loss).
